Abstract

Imitation is an idea adopted or derived from an original one and is a necessary tool for disseminating knowledge. The existence of imitation may lower the monetary returns of innovators and remove their creation incentives. This gives the rationale for the intellectual property right (IPR) protection system, whereby the returns of innovators can be secured and the incentives to innovate can be improved. The pertinence of such a viewpoint is, however, in doubt in some of innovative industries, such as software, computers, and semiconductors. Institutions that govern the creation and diffusion of inventions (knowledge) should balance the trade-off between IPR protection and imitating diffusion.